Saudi Arabia’s PIF solidifies position in US EV maker Lucid with additional USD 1 bn stake

PIF charges up Lucid with USD 1 bn investment: Saudi Arabia’s Public Investment Fund (PIF) will buy a USD 1 bn stake in US luxury EV manufacturer Lucid Motors through its Ayar Third Investment Company, according to a statement from the upstart EV company yesterday. The investment in the company — which the sovereign wealth fund already owns 60% of — will be executed through the sale of convertible preferred stocks.

The potential proceeds will finance the company’s capex and working capital, among other things, the statement reads.

Remember: Lucid has been assembling vehicles in Saudi Arabia since establishing its first factory outside of the US in Jeddah last September, but is planning to start manufacturing vehicles in the kingdom soon, Lucid’s marketing director for the region, Firas Kandalaft, told Saudi media last month.

Lucid is trying to wean itself off its dependence on the wealth fund: Earlier this month, Lucid CEO Peter Rawlinson said his company can no longer depend on the “bottomless wealth” of its Saudi owner PIF and would set in motion fundraising this year. Lucid has enough funds to last into 2025, but is burning through around USD 1 bn a quarter. The company is considering options including “bringing logistics under the same roof to reduce [operating spending], looking at the bill of materials, looking at overheads, looking at reducing anything that is variable.”

Market reax: Lucid’s share prices rose 5.4% to USD 2.9 a piece at yesterday’s close, but is down 31% YTD on the back of net losses doubling y-o-y to USD 2.8 bn in 2023.

ALSO WORTH NOTING-Planet Finance to Trump’s rescue? New Nasdaq company Trump Media & Technology Group Corp. (gotta have “group” and “corp” at the end when your asset is a social media platform nobody uses) could be The Donald’s ticket out of a tight spot. The company now owns Trump’s social media network — called Truth Social — after shareholders of spac Digital World Acquisition Corp voted to merge.

Think of Trump Media as a proxy for how Trump’s base views his candidacy: The Nasdaq-listed company’s shares were up more than 30% yesterday after an appeals court gave Trump 10 days to cough up the USD 175 mn bond in the civil case (above).

Sound smart: Trump’s stake in Trump Media? It’s worth north of USD 3 bn now — but he faces a six-month lockup. Shares start trading todayunder the ticker DJT.

THE MARKETS THIS MORNING-

Asian shares are largely in the green and stock futures are largely flat this morning, pointing to a muted open on Wall Street and in Europe later today. CNBC says traders are “taking a breather” on this holiday-shortened week. US benchmarks look set to close March with their fifth straight month of gains, while Korea’s Kospi just hit a two-year high.

THE CLOSING BELL-

The ADX stayed flat yesterday on turnover of AED 798.3 mn. The index is down 2.7% YTD.

In the green: Commercial Bank International (+11.1%), Abu Dhabi National Ins. Company (+6.8%) and Ooredoo (+4.6%).

In the red: Hayah Ins. Company (-5.3%), The National Bank of Ras Al Khaimah (-5.0%) and Sharjah Cement and Industrial Development (-4.0%).

Over on the DFM, the index also stayed flat, on turnover of AED 388.3 mn. Meanwhile Nasdaq Dubai closed up 0.1%.

CORPORATE ACTIONS-

ADX-listed GFH Financial Group’s shareholders approved a dividend payout of 6.2% for 2023, equivalent to 6.03 fils per share, the company said in a press release (pdf). The shareholders also earmarked USD 3 mn of the retained earnings for FY2023 for the company’s obligatory Zakat, with the rest of the amount to be paid by the shareholders.

Al Ain Ahlia Ins. Company’s board proposed a dividend payout of AED 30 mn for 2023, equivalent to AED 2 per share, according to an ADX disclosure (pdf).

Abu Dhabi National Ins. Company approved a dividend payout of 45 fils per share for 2023, amounting to AED 256.5 mn, reports Wam.

Al Wathba National Ins. Company’s board recommended dividends for 2023 equivalent to 25% of the company’s capital, according to an ADX disclosure (pdf).